Category:

Innovation

Mobius team having a discussion | Mobius
Innovation, Defined Contribution

Innovating to support DC schemes

The defined contribution (DC) pension market is maturing all the time, and at Mobius we continue to innovate to ensure our services stay ahead of the emerging needs of our clients.

As it’s January, we thought we’d take the opportunity to remind you about some of the DC subjects we wrote about last year – and how our platform capabilities can help DC schemes to achieve their members’ retirement income goals.

Manufacturing retirement-ready funds: In March we wrote about our capability to manufacture funds to meet specific pre-retirement objectives. These include drawdown-ready default funds and to-and-through retirement income generating funds. We’ve also manufactured funds designed to give annuity-like returns and funds designed for different age cohorts. You can read the full article on LinkedIn, here.

Evolving a pension administration eco-system. Wouldn’t it be fantastic if all the suppliers involved in delivering DC pensions could work together? These include consultants, investment managers, investment and member administration, governance, banking and data reporting providers as well as a host of other support services. Well, in May we wrote about how Mobius is helping to nurture a pension eco-system which brings together all the key providers involved in delivering workplace pension solutions. You can read the full article on our website here.

Pooled fund proxy voting – the Mobius platform approach. We know the government is keen to encourage pension schemes to vote their shares to support the policies set out in their Statements of Investment principles. In August we wrote about how Mobius is powering DC schemes invested in some of the pooled funds on our platform to vote. You can read the full article on the Mobius website, here.

More than just admin – the Mobius way. In September we wrote about how our clients benefit from capabilities which meet more than just their routine administration needs. These include access to investment in real assets or LDI solutions, specialist transaction cost and climate reporting and much more. You can learn more about these capabilities in this article here.

Delivering data for pension dashboards. We believe pension dashboards will be a game-changer, driving peoples’ engagement with their pensions and ultimately leading to a higher, more sustainable incomes in retirement. But they won’t get far without quality data. In November, we wrote about how Mobius already holds schemes’ pricing data and can feed this into dashboard providers’ systems, using data standards and formats they require. You can read the full article here.

This is just a snapshot of the range of services and capabilities we provide to DC schemes and over the next year, we’ll be regularly writing articles to highlight our wider capabilities. If you’d like to know more now, rather than wait, please email or call us today we’d be happy to tell you more.

Thank you for reading this blog, to find out more about Mobius, please visit our home page.

If you would like one of our team to contact you, please click here.

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Humanoid robot with clenched left hand | Mobius
Innovation, Defined Benefit, Defined Contribution

Innovating to meet the needs of our clients in 2022

2022 has of course been a challenging 12 months for many. At Mobius we’ve worked hard to deliver another year of high-quality investment administration and we’ve continued to innovate to respond to the emerging needs of our clients. Highlights of the year include:

Preparing schemes for buyout with targeted basket of gilts holdings: We developed our capabilities to buy and hold a bespoke basket of direct gilts to support schemes moving to buyout with insurers. We have the ability to leverage our broker/dealer and custodian relationships to buy and hold direct gilts on the platform within our life company structure as part of a scheme’s transition to an insurer. We believe Mobius is the only institutional platform to offer a direct gilt purchase solution of this type.

Providing greater control to investment managers for private market and private equity transactions: Asset allocation exposures may benefit by exerting greater control over the timing and price limits of trading certain illiquid investments. We recognised the benefit this brings to solutions which Scheme CIOs or fund managers create, by allowing direct access to our broker/dealers. This gives them greater control, while providing comfort that all transactions and administration are processed and recorded on the Mobius platform.

Breaking down barriers to make real assets available to DB schemes: Many DB schemes seek returns from illiquid real assets such as sustainable assets, social housing, low carbon assets, healthcare, education and digital infrastructure. Yet for many smaller investors these are difficult to access due to the high levels of governance required and complex fund structures. We have innovated by using the power of the Mobius platform to make real asset strategies available to DB schemes.

Enabling schemes to exercise their proxy voting power: The government has made it clear schemes will be expected to use their voting power to support their climate change investment strategies. We worked with schemes to design solutions which enable them to vote on the shares they own. This pioneering approach is the start of enabling direct influence and is only possible due to Mobius’ investment administration capabilities.

Developing solutions for DC schemes: We have developed a solution offering a selection of manufactured funds designed to provide schemes with access to a wide range of sophisticated investment strategies which may not normally be available to them. We anticipate that the first clients will be able to utilise these strategies soon.

….and of course, there’s LDI: Like all parties involved, Mobius had to respond to the unprecedented spike in collateral calls following the mini-budget and subsequent turbulence in the gilt markets. The UK pensions industry has never experienced such a surge in the volume of trading activity coupled with accelerated and compressed timeframes. Mobius adapted to help deal with these unique circumstances, underlining the ability of our platform to flex to meet our clients’ needs.

Industry recognition: Finally, we were delighted to be recognised again with yet another pensions award. Mobius won the Institutional Investment Platform of the Year Award at the UK Professional Pensions Awards 2022. This is the fourth year in succession Mobius has won the award.

We couldn’t have won the award without the support of our clients and their advisers, who continue to trust us to deliver the highest standards of investment administration, so a massive thank you to all! We will continue to work hard to meet your needs in 2023 and to innovate to respond to changes and emerging demands in the pensions industry.

Wishing all of you all the best for the festive season and the New Year

See you in 2023 !

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Lightbulbs hanging from a branch in a garden | Mobius
Investment Strategies, Innovation, Platform

Pension dashboards will drive engagement, but providers won’t go far without key data

Mobius believes that pension dashboards will be a game-changer, driving peoples’ engagement with their pensions and ultimately leading to a higher, more sustainable incomes in retirement.

But to succeed, pension dashboards will all need accurate information from a multitude of sources. Feeds will include pension valuations, daily and historic pricing and other critical data, all delivered in near real time.

That’s where schemes administered on the Mobius platform will have a clear advantage. We already hold schemes’ pricing data and can feed this into dashboard providers’ systems, using data standards and formats they require.

But why are pension dashboards such a great idea? The government estimates that people may build up to (some say at least) 11 different pension pots in their lifetime, so it’s no surprise that many find it almost impossible to keep track.

Dashboards will allow people to access information about all their pension savings, including the state pension, in one place online, on-demand, transforming how people engage with their pensions and savings.

Since the Pension Schemes Act was passed in 2021, stakeholders across the industry have been working to prepare for the introduction of dashboards – which for large schemes and master trusts should start from 2023.

We now have a clear view of the regulations that will underpin the provision of dashboards – following the DWP’s consultation which closed in March. The challenge is to get everything in place for the start of the dashboard revolution.

And there is no underestimating the challenge. Providers will need to locate multiple schemes using personal information such as name, address, date of birth and NI number. They will be obliged to protect people’s identity and meet the UK GDPR standards. They will also need to work out how information from multiple different schemes, both DB and DC, often with different benefit outcomes will be presented. The task is mind boggling.

But at its heart the success of the dashboards project will rely on good quality data.

At Mobius, we’re ready. We have accurate historic, and current, pricing data about all our pension scheme clients’ investments. We’re ready to feed this into dashboard providers’ systems, using the standards and formats they require.

It’s another advantage to schemes of using the Mobius pension platform to administer their investments and power their reporting. If you’d like to find out more about how we’re working to provide key data to dashboard providers, please give us a call today.

Thank you for reading this blog, to find out more about Mobius, please visit our home page.
If you would like one of our team to contact you, please click here.

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Person holding up 2 pieces of a jigsaw to see if they fit together | Mobius
Innovation

More than just admin – the Mobius way

There’s a wide choice of institutional investment platforms out there for pension schemes. Frankly, all of us are pretty good at delivering day-to-day investment administration. For some schemes this may be enough – today! But at Mobius we want to offer our clients capabilities which meet more than just routine administration needs and gives them a platform fit for purpose today, and tomorrow, now.

Our starting point is to understand our clients’ needs and then work with them, and their consultants, to offer tailored solutions at a competitive price rather than impose an administration straitjacket.
Let me give you three examples of how this approach works in practice.

  • Say your scheme wants an LDI solution. We don’t restrict our clients to a fixed range of funds – some of which may be proprietary to the platform provider. Rather we’ll find a solution that meets our client’s liability profile and cashflow requirements. And if there isn’t a fund available which matches these needs, will manufacture a bespoke fund – and yes, for smaller schemes too.
  • Another example; your scheme wants to invest in real assets to provide reliable contractual cashflows and inflation hedging. We don’t think our clients should be stuck with just a choice of a few open-ended property funds. Rather we’ll manufacture a solution with a bespoke range of assets, which could include sustainable real estate, low carbon energy, power and unities infrastructure, transportation, social housing, healthcare, education accommodation and digital infrastructure.
  • Our approach involves much more than just manufacturing specialist funds. We continuously look to understand what our clients may need next. That’s why we were ahead of the field in creating specialist transaction cost and TCFD reports to help them meet their SIP and now Chairs Statement reporting responsibilities.

These are just three quick examples of our approach. There is much more we offer our clients – covering every aspect of reporting and enabling better outcomes. If you want an analogy to illustrate what makes us different, think electric cars. There are now lots of electrically powered vehicles out there. But they are not all the same – at Mobius we’re much more Tesla than milk float.

Perhaps that’s why we have won the Professional Pensions Institutional Platform Provider of the year award four times on the trot.

At Mobius, we’re ready to flex our platform to meet your scheme’s exact needs. If you’d like to find out more about our approach, please give us a call today.

Thank you for reading this article, to find out more about Mobius, please visit our home page.

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Mobius Commercial Director, Laura Catterick making point in meeting to colleagues | Mobius
Innovation, Investment Strategies

Supporting sole trustee implementation

These findings come as no surprise to Mobius. We’re seeing more and more schemes with a sole professional trustee and we’ve been developing our services to meet their needs.

Some professional trustees assume the responsibility as a Chair/member of an existing trustee board working closely with lay trustees and the sponsoring employer. Others will be the sole trustee of the scheme working with the sponsor in making all the decisions on behalf of the scheme.

Often sole professional trustees work with multiple schemes. These are frequently small to mid-size schemes with assets of up to £200 million. This means professional trustees can control significant pools of assets in aggregate. We’re familiar with sole trustees acting for multiple schemes and being responsible for assets of over £1bn.

Sole trustees are taking on all the responsibility for implementation across all of their schemes and that can be daunting. This risk can be managed effectively by working with Mobius. Our investment administration capabilities mean that when they give an instruction it will be implemented efficiently, without them having to deal with multiple fund managers – or take on the implementation risk. Rebalancing, trigger point monitoring and transition management are all undertaken at the platform level allowing the trustee to concentrate on governance, strategy and delivering member benefits.

When sole trustees are working with multiple schemes, we take care of actions across all the schemes; for example, when LDI triggers are hit and adjusting leveraging levels are required. By pooling assets we can also give professional trustees access to more competitive fund management fees – or to funds which would otherwise have prohibitive minimum investment limits.

Trustees of all descriptions benefit from our independence. We deliver superior investment administration services, without the conflicts of being owned by an adviser or asset manager, or the lack of focus of being part of a major financial conglomerate.

It is likely more and more small to medium-sized pension schemes will appoint sole professional trustees in the future. And we are there to support them, by providing efficient investment and implementation. If you would like to find out more about our services for corporate trustees, please get in touch.

* Sole mates or Soul mates? Professional Corporate Sole Trustees and their sponsors, Lane Clark & Peacock, July 2021: https://www.lcp.uk.com/pensions-benefits/publications/sole-mates-or-soul-mates-professional-corporate-sole-trustees-and-their-sponsors/

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Members of the Mobius Team | Mobius
Innovation, Partnership

Delivering another year of service for our clients

At Mobius we’ve been fortunate to be pretty much unaffected by the pandemic. All our pension scheme clients have continued to invest and markets, barring some increased volatility, operated ‘relatively’ normally.

This means we’ve been able to continue to innovate to meet the needs of our clients and develop additional services to help meet their increased reporting and governance requirements.

As a business we are totally driven by our clients’ needs – and here are just a few of the innovations and developments we delivered to help them achieve their goals in 2021.

➢ Manufacturing a Structured Equity solution: In early 2021, we rolled out River and Mercantile’s Structured Equity solution on the platform – a first for the industry. Pension schemes of all sizes can now structure a growth asset tailored to meet their specific requirements through the Structured Equity approach, without being restricted by legal and governance costs, resources and minimum fees.

➢ Offering access to illiquid credit funds: This year an increasing number of clients told us they wanted to access illiquid alternative credit funds. For many investors these funds are difficult to access directly, due to higher governance requirements, given the complexity of the fund structures and dealing terms. We innovated by harnessing our infrastructure to tackle the challenges associated with illiquid assets. This included making alternative credit strategies offered by Apollo and Alcentra available to DB schemes.

➢ Meeting ESG, climate reporting and transaction cost disclosure: New regulatory requirements for schemes to make annual disclosures on ESG investments, climate metrics and transaction costs has added new governance burdens to already stretched trustees. We innovated to provide trustees with scheme-specific reports, which saves them the need to collate reports at an individual manager level. Using the power of the platform and our strong relationships with managers, we can provide these reports quickly and cost-effectively for trustees, enabling them to receive all the information they require from a single source.

➢ Supporting DC consolidation: We are using the power of the Mobius platform to support DC consolidation where schemes wish to combine assets create operational and efficiency savings. This initiative supports the government’s drive to encourage DC consolidation. We have worked closely with industry leading providers to support net zero funds initiatives and access to private markets. Our ability to cost effectively transition and blend funds has enabled trustees to develop blended climate-related default funds, with further innovation planned to support net-zero initiatives.

➢ Supporting DB consolidation: We have been appointed by Stoneport, the UK consolidator for smaller defined benefit schemes, as its investment platform provider.

➢ Investing in our team: We have continued to invest in the Mobius team, increasing our headcount by around a third since March 2020, with additional expertise in our operations, client servicing and distribution teams.

➢ Engaging with the pensions industry: We held our first online event for the investment management community in April 2021. Over 100 delegates from 63 investment managers joined to learn more about Mobius’ platform capabilities and to hear the perspectives of an investment consultant and fund manager.

And finally winning top industry awards!

And to cap it all we won not one, but two prestigious industry awards – the Professional Pensions Institutional Investment Platform of the Year (for the third year running!) and The Pension Age Innovation (Investment) Award.

So, 2021 was another busy year for Mobius.

We have worked hard to meet our clients’ needs throughout the year and look forward to continuing to serve them in 2022.

Wishing all of you all the best for the festive season and the new year.

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Mobius team having a discussion | Mobius
Innovation, Platform

The platform solution to VFM reporting for DC schemes

We all want to see excellent value in DC schemes – as the regulators say, it is a critical contributor in maximising the income savers have at retirement. But measuring, reporting and comparing VFM metrics could present some DC trustees with challenges.

And the existing reporting burden is only getting larger. VFM has been expanded beyond costs and charges to include additional metrics such as net performance reporting. No doubt more metrics will appear over time. This creates a further need for trustees to have access to sufficient information on the assets making up their default and self-select funds.

Of course, it’s not just about measurement – the real benefit is delivering and continuously improving VFM for members on multiple fronts. The key is having accurate, relevant and consumable data. For trustees, much of this data comes from fund metrics. Here at Mobius, we are committed to supporting DC schemes’ governance and oversight needs by providing our clients with the data they need.

Take the regulators’ requirement that members’ savings are not eroded by high costs and charges. Our tools enable trustees to access accurate transaction cost reporting at both a scheme and fund level, providing aggregated costs at a blended level, together with an attribution of those costs.

The regulators also want to see performance data available net of costs – to help trustees and members understand and compare the real returns they are achieving. Our tools deliver reliable information either to feed into performance engines, or to create net performance data. Again, this is available at a blended level and for the individual funds which make up the blend.

Critically, the regulators recognise well-designed default arrangements are essential in delivering VFM. Using the Mobius platform, trustees can configure default funds designed to meet their exact requirements, whether this is by blending existing funds, or by manufacturing a bespoke strategy from scratch.

And of course, for schemes using our target date fund blending capability, or lifestyle model portfolio approach, we can supply performance data by age cohorts – as proposed in the discussion paper. This means trustees can understand the actual returns their members are receiving, based on their age and time to retirement. It’s good to be ahead of the curve!

We can also help trustees to understand and report on important metrics such as ESG and TCFD/climate – which were highlighted in the discussion paper as a critical long-term driver of VFM.

It’s clear from the regulators’ discussion paper they want to see a common framework and transparency in VFM reporting. Using the Mobius platform trustees will be able to access the data they need to meet emerging VFM requirements. One less thing for trustees to worry about. If you want to know more, please get in touch.

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Old british coin | Mobius
Pension Strategy, Innovation, Pension Administration

Addressing pension scheme investment cost disparity

At the same time there is pressure from the government and regulators to keep costs for members as low as possible. There’s the charge-cap on default funds of 0.75% and the government is planning to stop providers levying a flat fee on members with small pots under £100. Now the Pension Regulator and Financial Conduct Authority has added to the challenge with their Value for Money discussion paper. This aims to ensure members’ funds are “well invested and their savings are not eroded by high costs and charges.” And rightly so!

Efficient operational delivery and execution is key to keeping costs down. One way for schemes to reduce administration cost and risk is to rethink the way the default fund is structured and delivered. Many default portfolios are constructed
using individual funds; managing these at a member level is largely inefficient, introduces risk, increases costs and can confuse members; reducing engagement and possibly member outcomes.

Or is there another way? Using the Mobius platform, pension trustees can benefit from sophisticated, thoughtfully constructed default funds, designed to Trustees’ exact specifications, blended into one or a choice of default funds, simplifying delivery and member communications.

Once trustees have defined their default fund investment strategy, we manufacture it from scratch or replicate an existing strategy, using our expertise and technology to meet our clients’ exact needs in a highly cost-effective manner. We’ve already created multiple bespoke default funds and other specialist funds for DC scheme members, including target date funds, zero-fee index funds, private asset and pooled property funds as well as structured equity solutions.

Efficient delivery models and blended fund structures can help reduce risk, improve schemes’ commercials, in turn helping manage the costs of the growing small-pot problem child. If you want to know more about how we can help you reduce your costs, call us today.

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Children playing with building blocks | Mobius
Innovation, Investment Strategies, Platform

Providing the building blocks for more parties than you think

A new standard of platform is needed to take advantage of these developments. And that’s where Mobius comes in. We provide the investment administration expertise, coupled with the flexibility to innovate, to enable our partners to power their solutions.

As a minimum you should expect your platform provider to support:

  • Investment administration
  • Transition management designed to minimise cost and out-of-market risk
  • Rebalancing and switching
  • Manufacturing blended funds with multiple hierarchies
  • Life-wrapping funds
  • Daily scheme valuations

Let’s take a snap shot of the more advanced capabilities we offer to DB and DC schemes, master trusts, superfunds, fiduciary  managers and asset managers:

  • Smart-rebalancing to fully automate and simplify rebalancing
  • Executing de-risking strategies and trigger-point monitoring
  • Manufacturing more sophisticated structures including illiquid asset classes
  • Zero-fee index funds
  • Structured equity solutions
  • Income-paying funds
  • Specialist funds range
  • Life company outsourcing
  • Target date funds
  • To-and-through retirement solutions
  • ESG reporting
  • Cost disclosure reporting

Can your platform do that?
We also bring the advantage of an independent perspective (see this recent post on independence). We are the UK’s largest independent institutional investment platform, so we are completely agnostic to solutions, asset managers and consultants. This means we can deliver best in class solutions without compromise.

And don’t forget, all of our services are available within a life company wrapper and as stand-alone non-life solutions. That means we can also serve asset managers and other organisations such as mutuals and friendly societies. Whatever our clients’ objectives, we provide the investment administration building blocks to help them succeed. If you’d like to find out more, call us today.

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Laura Catterick making a key point in presentation to Mobius team | Mobius
Innovation, Investment Strategies, Pension Administration

Innovating to help pension schemes achieve their goals.

That’s why Mobius has an ongoing programme of innovation. We want our clients – from the largest to smallest pension schemes – to benefit from the latest= developments, without being held back by regulatory, governance or cost barriers.

In the last 12 months Mobius has:

  • Created a first for the UK DC pension market by working with Macquarie Investment Management to manufacture a zero-fee index fund for a major UK DC scheme.
  • Partnered with Aegon Asset Management to develop the UK’s first property fund to provide a diversified exposure to the UK institutional property market for DC pension schemes – avoiding the concentration risk of using a single manager.
  • Worked with River and Mercantile to manufacture an innovative Structured Equity solution. DB pension schemes of all sizes can now structure a growth asset tailored to meet their specific requirements through a Structured Equity approach without being restricted by legal and governance paperwork and costs and prohibitive minimum fees.
  • Established a range of income paying funds on the platform, which can pay income directly into DB schemes bank accounts. This innovation means DB schemes with negative cash flow do not need to sell as many units to generate cash to pay benefits, reducing transaction costs and increasing efficiency.
  • Launched an ESG reporting service to help schemes complete their implementation statements. Our service provides a bespoke report for scheme trustees setting out their scheme’s asset managers’ attitudes and capabilities for investing responsibly. By using our reporting service trustees do not need to contact the managers individually, saving them time and expense.
  • Rolled-out an innovative ‘Smart Rebalancing’ approach to fully automate the rebalancing process for DB and DC pension schemes, reducing risk and cost.

But you don’t need just to take our word for the benefit to schemes of our ongoing innovation programme. This year we have been recognised by two of the pensions industry’s most prestigious awards programmes. We are finalists in the UK Pensions Awards DB and DC Innovation Awards 2021 AND the Pension Age Innovation Award 2021.

Our approach to innovation is yet another example of the benefits to schemes of holding their assets on the Mobius platform.

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